CENTRE FOR ECONOMIC AND SOCIAL STUDIES

The justification for a review of the early works arises from the profound effect they have had on the later day writings and from the need to put the analysis of the present paper in proper perspective, which we believe, departs considerably from some of the established works of the past. [...] Proposition 2: UR is associated negatively to the wage rate in the RNAS or with the ratio of the wage rates in the RNAS and the agricultural sector or briefly the ratio of the wage rates (or wage ratio). [...] Testing the Validity of the RSH with the Cross-Section Data of 1977-78 To test the validity or otherwise of the RSH, Vaidyanathan [1986] worked with the Current Daily Status Unemployment Rate (CDUR), the share of RNAE and the ratio of the wage rates. [...] The first of the two propositions advanced by Vaidyanathan [1986], involving the relationship between the UR – to be specific, the Current Daily Status Unemployment Rate (CDUR) or one of its proxies reflecting the distress conditions faced by the rural labour – and the share of the RNAE, alone has become the basis for categorising the RNAS as residual or otherwise in several writings. [...] Capturing Residual RNAE of Varying Degrees Using Alternative Measures of UR One reason why the RSH is revisited here is because the earlier works on the theme ignored the possibility that the residual nature of RNAE could be mainly a matter of degree and, that if the use of the more inclusive CDUR as a measure of UR in testing the validity of the RSH does not satisfy the two conditions put forward.